EY Germany to make structural changes in cost-reduction push (updated)

Wirecard AG

26/01/2023 09:42

(Adds response from EY Germany)
       Jan 26 (Reuters) - The German unit of EY, formerly known
as Ernst & Young, has decided to make structural changes with a
focus on personnel measures and reductions of non-personnel
costs, a company spokesperson told Reuters on Thursday in an
emailed statement.
    The company has initiated discussions with the so-called
co-determination body, the spokesperson said, referring to the
German system that gives workers a say in corporate
decision-making.     
    The Financial Times had reported earlier in the day, citing
sources, that EY Germany is planning to cut 40 partners and 380
staff as it looks to improve profitability following the
Wirecard scandal fallout.
    Majority of the partners facing the job cuts are from the
firm's audit practice, according to the FT report, accounting
for about 5% of the equity and salaried partners in the German
business.
    EY, one of the "Big Four" global accountant firms, had
audited and certified payments company Wirecard's books even as
journalists and investors raised questions about its finances.
Wirecard collapsed in 2020 after it was forced to admit that 1.9
billion euros ($2.07 billion) were missing from its balance
sheet.
   ($1 = 0.9165 euros)
 (Reporting by Gokul Pisharody and Jyoti Narayan in Bengaluru;
Editing by Sherry Jacob-Phillips)
 ((Gokul.Pisharody@thomsonreuters.com;))